A downside is that it results in higher costs as corporate support services (such as accounting and human resources) are duplicated in each of the four divisions. Boundary spanning leadership begins with managing existing boundaries, then expands to forging common ground, and, finally, moves into discovering new frontiers. The next step in designing an organizational structure is departmentalization—grouping specialized jobs into meaningful units. Start by listing what you imagine to be the duties of a given position; then, explain why these duties qualify it as a top-level management position. They must learn how to handle delegation—the process of entrusting work to subordinates. If, for example, you remove layers of management to make your organization flatter, you end up increasing the number of positions reporting to a particular supervisor. Companies determine which trade-offs to make according to a principle called span of control, which measures the number of people reporting to a particular manager. General Motors, for example, has four product-based divisions: Buick, Cadillac, Chevrolet, and GMC (Associated Press, 2010). You could have each employee perform all tasks entailed by taking and selling notes. The marketing department, for example, might butt heads with the accounting department because marketers want to spend as much as possible on advertising, while accountants want to control costs. Since their divorce, she is rarely seen on the red carpet without high heels, and she often meets 6' … Then, large logs are sold to lumber mills and smaller logs chopped up and sent to Bowater’s mills. If, on the other hand, services must be duplicated across units, costs will be higher. 5.4 Advantages and Disadvantages of Business Ownership, 5.7 How to Succeed in Managing a Business, Chapter 7: Recruiting, Motivating, and Keeping Quality Employees, Chapter 9: Marketing: Providing Value to Customers, Chapter 10: Product Design and Development, Chapter 11: Operations Management in Manufacturing and Service Industries, 11.1 Operations Management in Manufacturing, 11.3 Managing the Production Process in a Manufacturing Company, 11.4 Graphical Tools: PERT and Gantt Charts, 11.6 Operations Management for Service Providers, Chapter 12: The Role of Accounting in Business, 12.5 The Profession: Ethics and Opportunities, 14.4 A House Is Not a Piggy Bank: A Few Lessons from the Subprime Crisis, Chapter 15: Managing Information and Technology, 15.4 Computer Networks and Cloud Computing, 15.6 Security Issues in Electronic Communication, Chapter 16: The Legal and Regulatory Environment of Business. Successful managers make sure that all the activities identified in the planning process are assigned to some person, department, or team and that everyone has the resources needed to perform assigned activities. Traditional groupings of jobs result in different organizational structures, and for the sake of simplicity, we’ll focus on two types—functional and divisional organizations. Red October (Russian: Красный Oктябрь, Russian pronunciation: [ˈkrasnɨj ɐkˈtʲabrʲ], "Krasniy Oktyabr") is a modified Typhoon class submarine in Tom Clancy's novel The Hunt for Red October (1984) and the film of the same name (1990). If you refer back to the organization chart in Figure 6.5 “Organization Chart for Notes-4-You”, you’ll recall that, under your present structure, four managers report to you as the president of Notes-4-You: the heads of accounting, marketing, operations, and human resources. One of our favorites is the Walk-and-Talk, a surprisingly simple way to connect with others. Each division has its own research and development group, its own manufacturing operations, and its own marketing team. How many people does a manager supervise? Higher-level employees could focus on advertising, accounting, finance, and human resources. Yet, boundaries are also frontiers — a place of emergent opportunity and new possibility. The unintended consequence of matrixed and regional structures is that walls have been erected between groups that need to be collaborating. Each unit is headed by an individual with expertise in the unit’s particular function. Under a matrix structure, for example, employees from various functional areas (product design, manufacturing, finance, marketing, human resources, etc.) Ultimately, you’ll also hold your subordinates accountable for their performance. Vertical boundaries cross level, rank, seniority, authority, and power. When times are tough, our natural tendency is to hunker down. Demographic boundaries include the entire range of human diversity and social identity, from gender and race to education and ideology. To rectify this problem, most large companies are structured as divisional organizations made up of several smaller, self-contained units, or divisions, which are accountable for their own performance. It usually engages both people, leading to a comfortable conversation around the other questions. For most of us, it is not easy to lead outside our box in the organizational chart, across the lines of stakeholder interests, and beyond the borders of the division or groups we represent.
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